How Return-to-Work Programs Impact EMR

A Guide for Concrete Pump Supply Owners, Part 4

by Travis Bennett, Associate Director, National Casualty Loss Control at Risk Strategies

Editor’s note: This is the fourth article in a series to help concrete pump business owners navigate rising costs in today’s hard insurance market, characterized by policies becoming more expensive and harder to obtain.

An unfortunate truth is that incidents happen, especially in construction. Despite rigorous safety measures, job site hazards can lead to injuries and temporarily sideline valuable employees. While adopting best-in-class safety practices remains essential to minimize risk, what happens after an incident is equally critical. As employers, concrete pumping companies have a responsibility to anticipate hazards and develop controls to reduce claim frequency and severity.

Controlling the severity of claims is often tied to returning injured employees to full duty as quickly as possible. How employers handle the return-to-work process not only impacts morale and workforce productivity, it also influences a key metric for calculating workers’ compensation insurance premiums: the Experience Modification Rate (EMR). A well-designed return-to-work (RTW) program that gets employees back to work swiftly reduces lost time and claim costs, which results in a lower EMR.

THE LINK BETWEEN RTW AND EMR

The EMR is a numerical score insurance companies use to assess a company’s risk. The rating serves as a benchmark that compares an organization’s overall safety record and claim history to those of industry peers. An EMR of 1.0 is the industry average and maintaining an EMR at 1.0 or below indicates fewer or less severe claims, which can dramatically reduce a company’s premiums.

Work-related injuries involving employees losing time from their jobs is one of the major factors that increase an EMR. The longer an injured employee is away from work, the higher the associated claim costs, including wage-replacement benefits (indemnity payments), medical treatment, claims-management expenses and the ultimate claim-resolution cost. Returning an employee to an alternative or full-duty position helps to minimize the cost and duration of lost-time claims. By facilitating earlier returns through modified or transitional work, companies can effectively reduce workers’ compensation claim costs and, in turn, improve their EMR.

Here’s how a lower EMR benefits an organization’s bottom line over the long term:

• Lower premiums. Workers’ compensation premiums are calculated using a company’s EMR, along with payroll and industry class rates. Reducing the EMR directly reduces an organization’s premium costs.
• More opportunities to compete for jobs. A favorable EMR reflects well on a company’s safety culture and performance, making it more competitive for contracts. Many clients, particularly in construction, review an organization’s EMR as part of the pre-qualification process.
• Future workers’ comp cost savings. EMRs impact premiums over a three-year calculation cycle. Reducing claim costs today could ease insurance expenses for years to come.

HOW RTW PROGRAMS WORK

A proactive RTW program provides meaningful work activities for employees almost immediately after an injury. Injured employees are given alternative or modified duties that align with medical restrictions while they heal. Examples include administrative tasks, overseeing inventory or performing light equipment maintenance. Keeping in line with the concrete pumping industry’s focus on safety, some additional alternative duty tasks could be shop or job site safety inspections, truck inspections and safety training.

BENEFITS FOR EMPLOYERS

RTW programs aim to reduce the initial lost time associated with claims. Below are ways concrete pumping companies can benefit from these policies.

• Lower OSHA Lost Time Incident Rate (LTIR). Limiting the length of time an employee is out can significantly improve an organization’s LTIR.
• Improved retention. Experienced employees remain connected to the workforce rather than being permanently sidelined or replaced, reducing turnover-related expenses.
• Higher productivity. Retaining skilled, knowledgeable employees through alternative duty positions assists with achieving production goals as opposed to slowing production by hiring and training replacements.
• Stronger workplace morale. Employees who see their employer actively supporting injured colleagues tend to view the company as caring and proactive, promoting a positive workplace culture.

BENEFITS FOR EMPLOYEES

Studies show that employees who are out of work for more than 16 weeks rarely return to the workforce. The goal of RTW is to allow valued employees to return to productive, regular work as quickly as possible. By providing temporary transitional or modified work activity, injured and recovering employees remain an active and vital part of the organization, enabling:

• Skill retention. Workers maintain and enhance their skills by staying active in some form, benefiting both the employee and the business.
• Financial stability. Earning wages, even with modified work duties, protects employees from financial uncertainty caused by extended disability benefits.
• A healthier mindset. Having a reason to re-engage with the workplace gives recovering employees purpose and helps them form a healthy, focused routine.
• Social connection. Workplace reintegration fosters connections with the team, reducing feelings of isolation.

KEY FEATURES OF A STRONG RTW PROGRAM

For a successful early RTW strategy, consider integrating the following practices:

• Offer alternative or modified duty positions. Establish a process of annually reviewing alternative or modified duty positions to maintain applicable jobs that can be referenced quickly when needed throughout your operations.
• Collaborate with stakeholders. Work closely with insurers, adjusters and occupational clinics to develop an RTW plan tailored to the injured employee’s capabilities.
• Provide clear policies. Develop written RTW policies so employees and supervisors understand their roles and responsibilities. Ensure the occupational clinic understands your organization’s RTW program and acts as a partner.
• Log detailed documentation. Maintain records of all transitional work offers, assignments and progress reports. Such data supports claims management and demonstrates your commitment to insurers.
• Measure success. Use metrics such as claim duration, lost-time days and EMR improvements to evaluate the RTW program’s effectiveness.

BE PROACTIVE!

While the concrete pumping industry is working to minimize incidents through safety training, education and partnerships — including the We Are Safer Together campaign — concrete pumpers must still prepare for potential workplace injuries. By implementing a robust RTW program, pumpers can support injured employees through recovery while strengthening their competitive and financial position through EMR improvements. For example, if your annual workers’ comp premium is $100,000 and your EMR drops from 1.2 to 0.8, you could save $40,000 annually. That’s a significant savings that adds up over time! 

See other articles in this series:

• “Navigating Rising Insurance Costs in a Hard Market” (includes steps to implement a Staff Accountability Strategy)
• “10 Best-in-Class Safety Practices to Lower Insurance”
• “Excess Liability Coverage: How Much Do Pumpers Need?”